DESCRIPTION: (Applicant's Abstract) Economic evaluation of adolescent drug abuse services is a largely unexplored area of research. This study addresses a critical issue in the adolescent drug abuse field - the relative costs and benefits of intensive outpatient family therapy vs. residential services. Although research with adult substance abusers suggests that intensive outpatient approaches may be more cost-beneficial than residential services, no controlled study of this nature with adolescent drug abusers has been conducted. The outpatient therapy is an in-home, family-based intervention, Multidimensional Family Therapy (MDFT), which has demonstrated efficacy in randomized trials in comparison to various manualized outpatient modalities. The residential program is a social learning theory oriented, peer group focused intervention, called the Adolescent Treatment Program (ATP) at the Village, Inc. These two interventions are being compared in a controlled efficacy trial within the University of Miami Center for Treatment Research on Adolescent Drug Abuse, which examines changes in adolescents' drug use and comorbid symptoms from Intake to 18 months follow-up. The study sample for the proposed economic evaluation consists of 120 dually diagnosed adolescent drug abusers meeting ASAM criteria for residential treatment and randomly assigned to one of the two interventions. Adolescents and parents provide information on the youth's drug use and conduct problems as part of their regularly scheduled assessments at Intake, 2 months, 4 months, Discharge, 12 months and 18 months following Intake. In addition, adolescents and their parents provide service utilization data at each assessment point over the course of 18 months to determine the extent of services utilized by the youth and their family members during and following treatment. Clinical records from health, MH/SA, and juvenile justice agencies will be reviewed to confirm the use of these services and to estimate the costs of service utilization. The benefit-cost analysis will examine the costs of each intervention and the societal benefits in relation to health, mental health/substance abuse (MH/SA), juvenile justice (JJ), and school outcomes. In accord with recommended strategies for economic evaluation studies of health care interventions, we propose to examine outcomes from two important perspectives: 1) societal and 2) state policy makers.